OFAC sanctions (SDN list)
Also known as: SDN list · Specially Designated Nationals · OFAC screening · Sanctions screening · OFAC 50 percent rule
US economic sanctions administered by Treasury's Office of Foreign Assets Control, whose Specially Designated Nationals list names people and entities whose assets are blocked and with whom US persons generally may not deal.
Legal basis
OFAC, Sanctions List Service (SDN list)
OFAC administers sanctions programs against countries, regimes, terrorists, narcotics traffickers and other threats. Its best-known tool is the SDN list: assets of listed persons under US jurisdiction are blocked, and US persons are generally prohibited from dealing with them. Civil liability is strict — a company can be penalized even if it did not know the counterparty was sanctioned — which is why screening at onboarding and on every list update is standard practice.
The list is not the whole exposure. Under the 50 Percent Rule, an entity owned 50 percent or more, directly or indirectly, by one or more blocked persons is itself blocked even if it never appears on the list. Control without that ownership does not trigger the rule, but OFAC warns that such entities may be designated later. Records of transactions must be kept for at least 10 years.
Name matching alone fails on both ends: it floods analysts with false positives and misses the sanctioned owner behind a clean company. Resolving ownership chains, linking people and companies through a relationship graph and re-screening continuously is what makes screening defensible.
Frequently asked questions
What is the OFAC 50 percent rule?
Any entity owned 50 percent or more in the aggregate, directly or indirectly, by one or more blocked persons is considered blocked, even if it is not named on the SDN list. The rule looks at ownership, not control.
Is OFAC screening required?
No regulation prescribes a single screening method, but US persons are prohibited from dealing with blocked persons and civil liability is strict, so in practice banks, fintechs, insurers and other businesses screen customers and counterparties against OFAC lists and keep records for 10 years.